Jack Farley – Don’t Play in Markets You Don’t Know

<p><strong>BIO: </strong>Jack Farley is the host of the Forward Guidance podcast. He is interested in all things liquidity, macro, and central banking.</p><p><strong>STORY:</strong> Jack bought a lot of put options on the markets and individual stocks, notably Tesla, in February 2020 when the market was bearish. When the market crashed in March 2020, Jack made so much money. But, soon, the market started going up, and his position dropped to zero.</p><p><strong>LEARNING:</strong> Don’t view the market as a place to create wealth; view it as a place to grow it. Don’t confuse being lucky with being an intelligent investor.</p><p>&nbsp;</p><blockquote class="ql-align-center"><strong>“When you get a windfall, realize those gains, and at the very least, trim the position down.”</strong></blockquote><blockquote class="ql-align-center">Jack Farley</blockquote><p>&nbsp;</p><h2>Guest profile</h2><p><a href="https://www.linkedin.com/in/jack-farley-40b394112/" rel="noopener noreferrer" target="_blank"><strong>Jack Farley</strong></a> is the host of the <a href="https://podcasts.apple.com/us/podcast/forward-guidance/id1592743188" rel="noopener noreferrer" target="_blank">Forward Guidance podcast</a>. He is interested in all things liquidity, macro, and central banking. Jack graduated from Brown University with a degree in Economics and has done nearly 500 long-form interviews on investing and macroeconomics.</p><h2>Worst investment ever</h2><p>Jack had gotten quite bearish on the market in January and February 2020. So he bought a lot of put options on the markets and individual stocks, notably Tesla. All individual stocks crashed throughout early March 2020. Jack made so much more money than he ever thought was possible.</p><p>He continued consuming this bearish macro content from CNBC, Bloomberg, and the Wall Street Journal. When the stock market rallied from March 23 to April 1, Jack was told it was just a bear market rally and believed it. But the market continued to grind higher, and Jack’s position kept falling until i